Updated Budget Policy included as Attachment-1 to report 2026-357 – Finance Policy Updates… be approved

2:29:25Legislation has changed and updates are needed

2:29:28So staff in collaboration with craig dire advisory services have completed a comprehensive

2:29:33Review for several of our policies covering budget debt reserves and user fees

2:29:38The updates in front of you today are our results of that review where we've consolidated updated and streamlined the policy framework

2:29:47So taking a step back, uh, these policies are important for the city as they support three foundational principles

2:29:53sustainability vulnerability and flexibility

2:29:56Sustainable financial practices as guided by our policies help the city maintain services infrastructure and financial commitments

2:30:03Needed to meet future current and future community needs without shifting an unfair cost burden to future generations

2:30:10Compromising service quality or risking fiscal instability

2:30:13One good example of this is the city has been able to provide a balanced 10-year capital plan over the past two budget confirmations

2:30:19All while communicating the tradeoffs and risks with respect to asset management plan

2:30:24infrastructure to support growth and development and comprehensive

2:30:27service delivery plans

2:30:29Moving down to the green vulnerability is the city's preparedness to respond to the unexpected

2:30:35Our policies need to provide the framework for ensuring that when something unplanned happens

2:30:39We can respond in an effective and timely manner

2:30:42The city has a robust understanding of risk the enterprise risk management program as well as numerous

2:30:47mitigation strategies in place for those identified risks

2:30:51However, not everything can be foreseen or eliminated and sound financial policies provide the foundation for the city to be well positioned

2:30:58to respond when necessary

2:31:00Thirdly the city's ability to pursue opportunities or phase in new impacts over multiple years is why flexibility in financial planning is so important

2:31:08The landscape that minis municipalities operate in is frequently changing and the availability of contingency reserves provides a necessary flexibility

2:31:16To mean to manage effectively in this dynamic environments

2:31:21Moreover the long-term financial framework policies guide how the city plans for service delivery in a financially sustainable way

2:31:29limiting vulnerability, but also creating space for flexibility

2:31:33Clarity around how budgets are prepared amended and adopted helps council in the community

2:31:37See how decisions are made which creates a shared understanding of the financial practices at the city

2:31:43Our policies around capital financing provides clear criteria against which performance is measured

2:31:48Through target balances policy thresholds and guidelines

2:31:51A clear set of financial principles and policies help municipalities live within their means over the long term

2:31:57By setting thresholds or boundaries we avoid putting ourselves in a position

2:32:00Where we are over leveraged and also protecting future generations from undue burden

2:32:05The policies that address risk i.e. the investment debt management and reserve and reserve fund policy

2:32:10Helps shield us from unexpected surprises such as economic downturns revenue shortfalls or natural disasters

2:32:20So jumping back in here's the outcome of our policy work to date

2:32:24In the before box on the left the first four policies budget

2:32:27Revenue budgeting budget monitoring and year and surplus allocation has been consolidated into two

2:32:33First a significantly restructured and comprehensive budget policy and secondly a new user fees rate and charges policy

2:32:41Through this exercise

2:32:42We've also brought revisions to the debt management

2:32:44As well as the reserve and reserve fund policies with updates to ensure cohesiveness and modernization

2:32:51In addition to the policy level framework staff maintain internal procedure documents below the governance level

2:32:56For administration and guidance and we're working on updates to those documents ahead of the 2027 budget confirmation

2:33:02I'll now pass it over to dylan who will walk us through an overview of key changes and updates for each policy before you today

2:33:19As I walk through each of the policies i'll focus on what the most impactful changes were

2:33:23And the implications of these changes so starting with the budget policy

2:33:27This establishes the principles processes and responsibilities

2:33:31Governing the development approval monitoring and amendment of the city's operating and capital budgets

2:33:37This policy has the most substantive updates with several changes worth noting

2:33:43It's now a comprehensive policy that addresses budgeting budget monitoring and the year end surplus and deficit allocation within one policy

2:33:50Where previously this was covered over multiple policies

2:33:53First and probably most important the policy has been updated to align with the strong mayor legislation

2:33:59This legislation was introduced after the previous budget policy was approved and therefore needed to be added to the updated policy

2:34:07The update uh the update defines the mayor's role in setting budget direction and proposing the budget and council's role in proposing amendments and overriding

2:34:16overriding vetoes if needed

2:34:19Second the policy continues to support the four-year multi-year budget, which is aligned with the strategic plan

2:34:24This includes an annual budget confirmation to revisit assumptions and respond to new risks

2:34:30As part of the policy update, we've added staff authority for the year following the municipal election for in-term spending to avoid potential service gaps

2:34:38Which proactively manages risks from a delayed budget approval

2:34:42Additionally a new section of the policy gives staff guidance on how to develop the budget for the final year of the multi-year budget

2:34:48While the municipal election is taking place

2:34:51It seems to balance between the staff time needed to develop the budget materials with maintaining space for the newly elected mayor

2:34:58To make adjustments through their proposed budget after the after the election

2:35:03and lastly

2:35:04Lastly we've clarified the thresholds and mechanisms for minor and and administrative adjustments

2:35:10Versus a material adjustment

2:35:12This helps balance between efficient processes and ensuring council oversight for any material financial or scope change

2:35:24our user fee

2:35:26Our user fees rates and charges policy is a new standalone policy

2:35:31Previously

2:35:32Previously guidance for on user fees was provided through the former revenue budgeting policy, which is being repealed through this

2:35:39policy update

2:35:41This policy sets out clear criteria for when a fee should be used and how we determine the right level of cost recovery

2:35:47The most impactful policy change that council can now authorize annual indexing of fees through the user fee by-law based on

2:35:54applicable measures such as consumer price index

2:35:57That means routine inflationary adjustments don't need to come back to council every year, which creates more predictability for the public

2:36:04Staff-led fee reviews will continue to occur at the start of each multi-year budget cycle for many of the fees

2:36:10From time to time comprehensive fee studies occur outside the budget process for more complex services

2:36:16Which allows for greater public engagement?

2:36:19The changes resulting from these fee studies will then be incorporated into the next budget update

2:36:27Now moving on to the debt management policy

2:36:30This guides how we allocate our future debt and to what extent

2:36:34It also guides what financing instruments are available to us and helps maintain a sound financial position

2:36:39Which protects a favorable credit rating for the city

2:36:43The key takeaway here is what's not changing in our policy, which is our overall debt servicing cost limit remaining at 10% of own source revenue

2:36:51This measure share this measures the share of city revenue that's being consumed by previously approved

2:36:58projects and this policy limit continues to balance between preserving borrowing costs or

2:37:04preserving borrowing capacity and managing debt servicing costs to maintain

2:37:08Budget flexibility with promoting the principle of intergenerational equity by spreading costs into the future period where the assets will be consumed

2:37:17What is new in this policy is more specific guidelines within the overall 10% limit

2:37:22Which breaks down debt servicing costs by the type of revenue that supports it

2:37:26This includes property tax supported debt

2:37:29rate supported debt and dc supported debt

2:37:32These sub guidelines provide additional visibility into debt servicing capacity, which will help identify and communicate risk

2:37:40related to the debt strategy

2:37:42There are also a few administrative updates included in this policy

2:37:46Like permitting sinking funds as a financing option

2:37:50Authorizing the treasurer to appoint a fiscal agent for debenture issuances and updating the eligible purposes for which debt can be issued

2:38:00Finally on to the reserve and reserve fund policy

2:38:03This policy establishes guidelines and controls for the creation use and management of all the cities reserve and reserve funds

2:38:10Much of the existing reserve and reserve fund policy remains fundamentally the same

2:38:14The updated policy provides additional details regarding roles and responsibilities of council the treasurer

2:38:21executive team and the local boards in alignment with our current practices

2:38:26Additionally, this update provides greater alignment with the budget policy specifically for amendments to the budget

2:38:32This allows for consistent authority between amendments to the budget in the budget policy and the use of reserve and reserve funds

2:38:38in in this policy

2:38:40Lastly, we reviewed the individual terms of the reserve and reserve funds found in appendix b

2:38:46We updated some of the terms to be more consistent with each other

2:38:50Stemming from this review. We are we are proposing to close

2:38:54Four existing reserves three are consolidations into other reserves and are on the slide before you

2:39:00The balance of the health care spending for fire folds into the accumulated sick leave for fire

2:39:05The downtown improvement reserve folds into the reason redevelopment incentive reserve

2:39:10And the public art reserve folds into the service enhancement reserve

2:39:13The fourth is just a closure for the public transit fund

2:39:17With its balance being used to offset 2026 operating expenses since this grant has now been closed

2:39:28looking ahead

2:39:30To upcoming policy updates included in today's agenda as a separate item is an administrative update to the asset management policy

2:39:37This update was legislatively required. However, asset management and finance staff have identified the need for a more comprehensive review of this policy

2:39:45To enhance the alignment to the other long-term financial framework policies

2:39:50In the future recognizing that the the critical role that the asset management

2:39:55policy plays in long-term financial sustainability of the city

2:39:59The city's investment policy was last updated in 2021 and it will be the next long-term financial framework policy that is reviewed and updated

2:40:07And finally the repeal of the existing letter of credit by-law will be on the july 21st city city council agenda for approval

2:40:15This by-law will be replaced

2:40:17This by-law will be replaced with an updated securities policy that will be approved under the CAO's delegated authority and incorporates

2:40:25updated legislative requirements for development securities to include charity bonds

2:40:35And with that we're happy to answer your questions about these policy updates. Thanks

2:40:44So we have a motion to put on the floor

2:40:48So councillor alts we have a seconder

2:40:51Councillor hauser can you read that out for us out loud for accessibility please councillor Allt

2:41:04motion alt

2:41:06moved by alt seconded hauser financial policy updates

2:41:102026-357

2:41:12One that the updated budget policy included as attachment one to report 2026 357

2:41:19financial policy updates be approved

2:41:21Two that the updated user fees and charges policy included as attachment two to the report

2:41:282026 357

2:41:30Finance policy updates be approved

2:41:32Three that the existing budget monitoring policy revenue budgeting policy here and operating surplus allocation policy be repealed

2:41:43Four that the updated debt management policy included as attachment three to report

2:41:502026-357

2:41:52Finance policy updates be approved five that the updated reserves and reserve fund policy included as attachment four to report

2:42:022026-357

2:42:05Financial policies update be approved and I don't think there's anything after that

2:42:11Thank you

2:42:13Thank you so much. Are there any questions?

2:42:19Amazing. Oh, we've got councillor busetel

2:42:23Yes, thank you. Um in your presentation you talked about the external agencies and boards

2:42:29I had to search to find the the specific section

2:42:33About it's in the responsibilities. I was curious why it's just public library and well police services and not

2:42:40As my colleague and I have chatted about

2:42:44social services as well

2:42:47And some of the other

2:42:48External agencies and boards and it's on page. I have to find it page nine of 38

2:42:54In the attachment for

2:43:08through the chair

2:43:09The reasoning the reasoning there is that the reserve and reserve funds that we have are for

2:43:15Um

2:43:16The gulf police services and the gulf public library and we don't have reserve and reserve funds for the other local boards or shared services

2:43:26And so that doesn't sorry through through the chair so that doesn't extend to um housing

2:43:33Reserves that may be directed to

2:43:36social services for housing

2:43:39Kind of initiatives. Can you just clarify that? That's why I was a little bit surprised

2:43:45Sure through chair Caton

2:43:48The

2:43:49We do have a social housing reserve

2:43:51We use that reserve for the purposes of capital that

2:43:55Transitions or carries over from year to year

2:43:58So capital spending that's included in the budget

2:44:01From the county gets included in our operating budget and at the end of the year any

2:44:07Unspent capital gets put the funding gets put in that reserve because it will come out in the next year

2:44:12And so that way we make sure that we have the money

2:44:15When we get the bill from the county for that capital and could you just help me understand clearly where

2:44:21Where your references I was just scrambling to find in that attachment

2:44:27Thank you. It's under the heading of roles and responsibilities city council the treasure

2:44:33And then executive team gulf police services and gulf public library shall and it's on page nine

2:44:40Uh attachment for reserve and reserve fund

2:44:46So and I and it kind of links into and my colleague counselor down or raised it in the previous presentation as well

2:44:53I too wondered about risk

2:44:56An external kind of funding not particular to any agency

2:45:00But you know transparency and the risk in the overall budget because the public doesn't separate the city from

2:45:07They just look at the big number

2:45:09So I was trying to put the two together and ask that same question around

2:45:14The accountability and the other values that we have in our budget process. So that's why I'm asking it

2:45:21specifically about gulf police and the gulf public library shall and how does it translate into

2:45:27Specifically around housing and social services

2:45:30So thank you. Okay. Thank you. I I have more clarity on your question through chair Caton

2:45:35The so the reason why there's specific

2:45:39guidance for gulf police and gulf public library is because those two organizations have

2:45:45Specific capital and contingency reserves under the managed under the city's reserve and reserve fund policy

2:45:52And the other organizations do not and so we still plan for and support those

2:45:59Other that manage the budget risk through those organizations through the city's other suite of reserves

2:46:05And so as you'll recall through the multi-year budget

2:46:08We've phased in significant increases for social housing using the tax operating contingency reserve

2:46:15So those are specific requirements that kind of govern or that govern how

2:46:20The gulf police and gulf public library board reserves will be managed

2:46:25Those specific reserve funds

2:46:29Through the chair. Thank you. Thank you. Councillor busito. Any further questions?

2:46:37Seeing none, I'll call the question

2:46:41Anybody against?

2:46:45That's no one so unanimous. Thank you very much

2:46:49And we're going to move on to item 14.2

2:46:54the

2:46:552026 to 2029

2:46:5712 community safety and well-being plan

2:47:00and this will be presented by

2:47:03uh, Steven

2:47:05Schmeid or schmied

2:47:06Which someone can confirm that one for me

2:47:12stephen schmeid. Thank you so much